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Thursday, 28 August 2014

Thursday, August 28, 2014 Posted by Hari 4 comments Labels:
Posted by Hari on Thursday, August 28, 2014 with 4 comments | Labels:

Workers in the UK are CHEAPER to hire than in Spain or Italy as stagnant wages erode British pay packets
The average cost of employing someone in the UK remained unchanged at 20.90 euros an hour last year – significantly below the EU average of 23.70 euros. Meanwhile the cost of employing someone in Spain is higher at 21.10 euros and higher still at 28.10 euros in Italy, according to official figures from the EU's statistics office Eurostat. The average hourly labour cost in Norway is more than double that of the UK at an eye-watering 48.50 euros an hour. Meanwhile Labour costs in Germany are now around 50 per cent higher than in the UK – 31.3 euros an hour versus the UK’s 20.9 euros. Labour costs in France are even higher at 34.3 euros an hour. In fact the UK is among just five countries that saw wages fall or stay the same between 2008 and 2013, including Poland, Hungary, Croatia and Greece. Wages are expected to grow by just 1.25 per cent this year, which amounts to a drop in real terms as inflation is currently at 1.6 per cent. A weak pound throughout the economic downturn may also have helped widen the gap between the UK and its EU neighbours. DAILY MAIL

High energy bills? Blame Ed’s price freeze threat says the boss of Npower
So far this year, wholesale gas prices, which make up nearly half of energy bills, have fallen by more than 50 per cent. But the boss of one of the biggest energy companies has said it would be too risky to cut prices ahead of winter because of Labour’s threatened price freeze. Paul Massara, head of Npower, said the firm had not reduced fuel bills despite a slump in wholesale prices – as an election victory for Ed Miliband would see them forced to stick with the new tariffs for 20 months. Last September, Mr Miliband said he would freeze gas and electricity bills in the UK for 20 months if he wins the general election in May next year. Charlie Elphicke, Tory MP for Dover and Deal, said: ‘Clearly Ed Miliband’s policy has backfired and is driving up energy bills today at a time when people can least afford it. Instead of making things easier, they are making them worse. Labour’s energy spokesman Caroline Flint defended its policy, saying: ‘All the energy companies have 101 excuses about why they won’t cut their prices, but if Npower are publicly admitting that they are keeping their prices artificially high and the Government is doing nothing about it, that shows exactly why we need reform of the energy market.’ DAILY MAIL

Food poverty: Faculty of Public Health issues malnutrition health warning
More people are suffering from malnutrition as a result of worsening food poverty, experts have warned. The Faculty of Public Health said conditions like rickets were becoming more apparent because people could not afford quality food in their diet. Data from the Health and Social Care Information Centre showed the number of those admitted to hospital in England and Wales had risen from 5,469 to 6,520 over the past year. Vice president of the Faculty of Public Health, John Middleton, said food-related ill health was getting worse "through extreme poverty and the use of food banks". The faculty recently claimed that UK food prices had risen by 12% since 2007. It also noted that in the same period, UK workers had suffered a 7.6% fall in wages. The main symptom of malnutrition is rapid weight loss - usually 5-10% within a few months. Other signs include: weak muscles, constantly feeling tired, an increase in illnesses or infections, children will not grow as quickly, and will show changes in behaviour becoming irritable, sluggish and anxious. Meanwhile, Durham Police and Crime Commissioner Ron Hogg told BBC Radio 4's Today programme some people were resorting to committing crime "simply to live". "The evidence shows that shoplifting and theft in general is rising exponentially and there must be a reason for that," he said, adding that it was important to address the causes of such crimes. Health Minister Dan Poulter said the government had "given local authorities a £5.4bn budget over two years to help them manage public health issues, including malnutrition, in their areas." He also said the rise in malnutrition could be partly due to better diagnosis and detection by health professionals of people at risk. BBC NEWS

EDF to pay £3m for mishandling complaints from vulnerable customers
EDF has been ordered to pay out £3 million to benefit “vulnerable customers” after an investigation by the energy industry watchdog Ofgem found that the big six supplier had breached complaint handling rules. The payout is the latest in a series of punishments meted out to the dominant energy suppliers and came just a day after Labour promised to strip any provider of its operating licence if it mistreated customers by repeatedly breaking the rules. The inquiry into EDF, a French state-owned firm, came after it recorded an increase of more than 30 per cent in the levels of complaints during the introduction of a new IT system in 2011. All the big six energy providers have been fined for similar reasons, as well as mis-selling. For example last October, Scottish Power agreed to pay £8.5 million to its customers after an investigation by Ofgem found it gave misleading information during sales. In March, the regulator found that the big six collectively owed more than £400 million to 3.5 million former customers who have switched supplier or moved house in the previous six years. It demanded that they make sure the money is returned. INDEPENDENT


Bank of America pays record $17bn to settle US 'toxic mortgage' claims
It is the largest single settlement by a company in US history, eclipsing a $13bn settlement JP Morgan Chase agreed with regulators last year also related to securities backed by homes. Bank of America will pay a total of $9.65bn in cash and provide around $7bn worth of relief for mortgage customers. The cash portion consists of a $5.02bn civil penalty and $4.63bn for compensation. The bank said the "claims relate primarily to conduct that occurred at Countrywide and Merrill Lynch" before it acquired them during the height of the financial crisis in 2008. In California, the government said Countrywide concealed from investors the company's use of "shadow guidelines" that permitted loans to riskier borrowers than Countrywide's underwriting guidelines would otherwise allow. Another example laid out in a 30-page statement of facts that was part of the settlement said Bank of America knew that a significant number of loans packaged into $850m in securities were experiencing a marked increase in underwriting defects. Despite this, the bank sold these residential mortgage-backed securities to federally backed financial institutions. TELEGRAPH

RBS fined £14.5m for poor mortgage records and advice
The financial regulator said two reviews of sales from 2012 found that in more than half the cases the suitability of the advice given to customers was not clear. Only two of the 164 sales reviewed were considered “to meet the standard required overall in a sales process”, the FCA said, and some advice was “highly inappropriate and may have resulted in the borrower being sold the wrong type of mortgage for them”. Moreover, the banks did not address the failings for almost a year when concerns were raised by the FCA’s predecessor in November 2011. Tracey McDermott, the FCA’s director of enforcement and financial crime, said: “Taking out a mortgage is one of the most important financial decisions we can make. Poor advice could cost someone their home so it’s vital that the advice process is fit for purpose. Both firms failed to ensure that their customers were getting the best advice for them.” RBS still faces several claims over the alleged manipulation of the foreign exchange market; the sale of US mortgage-backed securities; small business lending in the UK; and the mis-selling of payment protection insurance and interest rate swaps. Martin Wheatley, the FCA’s chief executive, warned last month that more fines for UK banks were in the pipeline, and attacked the financial services sector for its capacity to “constantly surprise with bad conduct”. FINANCIAL TIMES

Official crime figures 'failing to report 4m fraud cases' meaning total number of offences should be 50% higher
If bank and credit card fraud were included in the annual Crime Survey for England and Wales, the estimated number of annual offences would jump by 50 per cent - taking the total from 7.3 million to 11 million offences a year. Marion FitzGerald, visiting professor of criminology at the University of Kent, said claims of ever-falling crime were misleading because the crime survey excluded card fraud.  ‘As patterns of crime have changed over the last 20 years or more, the crime survey failed to track these changes and so it has continued to tell a story which is music to ministers’ ears,’ she said. Statisticians said that the plastic card fraud figures are not included ‘due to conceptual difficulties with assigning victimisation’ - whether the crime is committed against the plastic card holder or the bank or financial institution issuing the card. But the new Office of National Statistics figures, which include bank and credit card fraud, suggest the annual Crime Survey disguised the massive scale of fraud across the UK. It  means that seven people are defrauded every single minute. DAILY MAIL

Burger King acquires Canada’s Tim Hortons and calls Obama's bluff over tax dodging
Wall Street’s dealmakers called Barack Obama’s bluff on Tuesday with the acquisition by Burger King of a Canadian coffee chain, which could embolden other multinationals looking for similar tax savings to move their headquarters abroad. Such arrangements have already proven popular elsewhere this year. Among proposed US cross-border mergers, nearly two-thirds are being done for the tax benefit, according to data from Thomson Reuters. Though faced with vocal opposition from the White House to the process known as tax inversions, the bankers and lawyers advising Burger King will have known that the president has a weak hand: without binding legislation from Congress to close the underlying tax loophole that allows such deals, the president had limited options beyond naming and shaming those who exploit it. This threat of moral opprobrium in Washington and theoretical risk of future legislation that might require reversing the transaction have been enough to deter several previous attempts. Drug store chain Walgreens abandoned similar plans to move its US headquarters to Europe when it bought the remainder of Alliance Boots. Pfizer had been examining a similar move as part of its initially-rebuffed approach to AstraZeneca. But with many multinationals accumulating growing piles of cash in overseas subsidiaries that they are reluctant to repatriate to high tax jurisdictions like the US, there is growing pressure to structure mergers in ways that allow the whole corporate entity to move to a cheaper location. That the Burger King and Tim Hortons deal was partially funded by Warren Buffett, a billionaire previously noted for criticising the low tax rates enjoyed by the very rich, only served to underscore a view on Wall Street that it is up to lawmakers to change the law if they don’t like its consequences. GUARDIAN

4 comments:

  1. But wages are only part of the cost of employment. I think you will find it is not a good thing that it is mroe expensive to hire people in Spain or Italy -- hence their massive levels of unemployment. Poor article.

    ReplyDelete
    Replies
    1. "Hourly labour costs" include non-wage costs e.g. employer social contributions etc. See http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Hourly_labour_costs

      The down side (or one of the down sides!) of a low wage economy is low high street spending. Need to get the balance right. Do you aspire to being Spain, or Germany?!

      The article is by the Daily Mail, not us. This News Round Up is our weekly pick of the mainstream media's news.

      Delete
  2. Ford is moving mondeoproduction from.genk belgium to Spain. 4000 job losses

    ReplyDelete
  3. Reality check from a Spaniard: The average salary of a Spanish *skilled* worker in a full time, 40 hours per week job, for which a university degree is demanded, is €1,000 per month. They are also made to work a serious amount of unpaid overtime. These employees are called 'mileuristas' (literally, 'thousand-eurists') by the Spanish government, and referred to as the lucky ones, given the fact that plenty of people are earning €600 euros a monh. Spain has a historical, endemic bad reputation for paying poor salaries, and this was happening even in the middle of the economic boom.The very idea that a worker earns more money in Spain than in the UK is just too ridiculous to contemplate.

    ReplyDelete

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